Wrong by a factor of eight: the FT on green energy costs report
- 16 Dec 2011, 14:33
- Robin Webster
Yesterday we wrote about the media coverage of the Climate
Change Committee's analysis of energy bills, in particular
highlighting some
pretty epic cherrypicking by the Daily Mail.
We commented at the time that, apart from the Mail article, the
reporting had been pretty accurate. However, we actually missed
what seems to be the most inaccurate presentation of the
Committee's findings, because we didn't look properly at the
FT's article (£ - or
here for free, rewritten a little). (Thanks @neilstockley for
bringing it to our attention.)
The FT's article is headlined "Household energy bills to rise by
£100 a year", and the first sentence reads:
Consumers can expect their household
energy bills to increase by £100 a year over the current decade to
support carbon-reduction commitments, according to a
government-sponsored report.
This just seems to be plain wrong. The CCC's report says that
average household energy bills will rise from around £1060 in 2010
to £1250 in 2020. This is a rise of £190 in total - nowhere near
"£100 a year".
Over the decade, the CCC estimate that the impact of 'green
measures' on bills will increase by £110, compared to now.
The FT's estimate of costs to 'support carbon-reduction
commitments' over the same period amounts to £900 by 2020 -
so in reporting the CCC's findings, they are out by a factor of
about eight.
Normally with these kind of figures it's obvious how they have
been mangled to produce inaccuracies. But on this one, we are
genuinely stumped.
The FT should have got this right - particularly as later on on
the article, they quote Lord Turner, who contradicts their headline
in very simple terms:
"Over the next decade, we anticipate a
rise of around £100 in the average bill as a result of investment
in low-carbon power capacity, which will benefit the UK in the long
run. And if we introduce new policies to stimulate energy
efficiency improvement then bills in 2020 could broadly be
contained at current levels."
If anyone has any ideas for how this happened, we'd welcome
them. It could be a case of having confused total rise with
per-year rise - if so, that would be a pretty fundamental
error.
Less of an issue, but also worth noting, is some 'percentage
creep'. The FT write:
Charges to support the
reduction in carbon emissions are expected to rise from around
8 per cent of energy bills to nearly 20 per cent over the current
decade.
By 2020 the CCC estimate that green energy measures will account
for £190 of a £1250 energy bill - which is 15.2%, not "nearly 20%"
as the FT report.
The rest of the article appears to be accurate. It's finished off
by a quote from Benny Peiser, Director of the Global Warming Policy
Foundation:
"Benny Peiser, director of the lobby
group argued that the government faced "a political backlash" if it
accepted higher subsidies for high-cost alternative forms of energy
generation."
Given the GWPF's previous
contributions to the accuracy of this debate, perhaps it's
fitting that they are quoted in an article that appears to get the
numbers so perplexingly wrong.
UPDATE 19/12/11 We have now had a response from the FT, who tell
us that the headline and first paragraph of the FT piece were
intended to mean that the annual costs of green energy to consumers
will rise by £100 in total ("£100 a year") rather than £100 every
year. This does make sense - and answers our question about how
they got there. However we would suggest the headline "Household
energy bills to rise by £100 a year" is much more likely to be
interpreted as an annual, rather than total, rise of £100. A
headline which makes the real facts clear might have been a better
idea.